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Indexes hold their highs

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In a rather bold display of investor optimism on today's stronger-than forecasted new housing numbers, the major indexes hold near their highs of the session, with the NASDAQ-100 Index (NDX.X) 1,169 +3.49% threatening to close at a new multi-month high and the highest levels seen since a June 5, 2002 close of 1,195.60 as biotech's continue to be among today's sector winner's list with the Biotechnology Index (BTK.X) 453 +4.73% leading tech-gains.

Market internals show a slight pickup in volume, but not considered heavy with the NYSE churning just over 1.1 billion shares. Internals at the NYSE have advances easily outnumbering decliners by a 2 to 1 margin, with the number of new 52-week highs building to an impressive 373 compared to just 9 stocks trading new lows.

NASDAQ volume shows interest among traders with just over 1.5 billion shares traded. Advancers outnumber decliners by a 7 to 3 margin, with 252 stocks reaching a new 52-week high compared to just 6 stocks trading new lows.

Shares of Intel (NASDAQ:INTC) $19.66 +4.51% are today's most actively traded stock (above $5), with 59.8 million shares traded as gains help bolster the Semiconductor Index (SOX.X) 364 +5.8% to the top spot of sector winners. The break above the recent weekly highs of 362 now look to have the SOX set to challenge its December highs of 393.80. According to Dorsey/Wright & Associates, their Semiconductor Bullish % (BPSEMI) currently reads "bull confirmed" at 56.56% and not yet near the more "overbought" 70% level as that found in late November. As such, with NASDAQ-100 action breaking to new highs, I'm looking for the SOX to reach its December highs as MARKET bullishness looks to continue to build.

Bulls got some needed selling from the bond market on today's news. While the shorter-dated 5-year did see fractional selling, bond bulls may have looked to take some profits in the longer- dated 10-year and 30-year Treasury maturities. The 10-year YIELD ($TNX.X) rose from a multi-year low to finish up 6.8 basis points at 3.401%, while the 30-year YIELD ($TYX.X) rose 10.8 basis points to close with a 4.362% YIELD. The selling in treasuries most likely looks to bring some short-term bears off their chairs with the NASDAQ-100 Index breaking to new highs, and builds hope that the S&P 500, S&P 100 (OEX.X) 479 +1.98% and Dow Industrials (INDU) 8,777 +2% will look to follow.

Jeff Bailey

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